Birol Growth Consulting Helps Jeffrey J. Morella and the Complete Captive Solution, LLC Grow Quickly and Profitably Toward Long-Term Success.

Background:

In 1991, Jeffrey J. Morella opened Morella & Associates, A Professional Corporation and has built it into a successful practice focused on meeting the legal and tax planning needs of business owners.  Over the years, Jeff’s expertise continued to grow as his clients faced increasingly sophisticated tax, insurance and business planning challenges. In 2005, Jeff began assisting his business clients in creating captive insurance companies as a cost-saving vehicle and to provide more flexibility for their companies.

Then in 2010, as Jeff watched the Federal Government’s punitive tax policies create an ever-increasing burden on the plans and dreams of small business owners, Jeff knew he had to find new ways to bring needed relief to his clients.  In response to his large base of business owners’ pleas to reduce their insurance costs and preserve more income, Jeff began expanding his expertise in the captive insurance field of creating alternative insurance structures that reduce insurance costs, as well as provide opportunities for asset protection, wealth transfer, estate and tax planning, and business succession planning. These alternative insurance structures, specifically known as series captives, allowed Jeff to create, build and manage customized, independently owned Series Business Units (“SBUs”) for his clients.

Current Situation:

As Jeff Morella’s expertise and success continued to grow with Series Captives, he knew it was time to spin off this growing practice into a standalone business that could establish and run captive insurance companies under its own brand.  But how could Jeff do this?  After watching his competitors stumble when trying to run similar businesses as a sideline to their legal, accounting or insurance practices, he was determined to correctly and independently build his business right from the start.  But in 2012, as his questions of how to price the services, establish the distribution network and build the business infrastructure mounted, Jeff knew that these decisions called for business growth expertise outside of his legal training, and he needed help now.  That is when he called in Andy Birol of Birol Growth Consulting.  As Jeff states, “I was impressed by Andy’s out-of-the-box thinking, as well as how quickly he built his business growth practice in Pittsburgh, so I called him in, dumped my files, business challenges and goals on his lap, sat back and watched how he would react.  To my delight, Andy quickly grasped, synthesized and framed all my thoughts into four key tactics for us to build my new business.”

Birol Growth Consulting Solution:

Upon his engagement, Andy tore into Jeff’s financial analyses and interviewed his business partners and clients.  Andy quickly recognized that while Jeff had created a breakthrough, proprietary approach to providing “The Complete Captive Solution” (a/k/a the new company), without an equally sophisticated approach to marketing, selling, distributing and delivering its value, Jeff could not achieve the results he expected.  What specifically did Andy accomplish for Jeffrey J. Morella and his new business, The Complete Captive Solution, LLC (“CCS”)?

Andy worked with Jeff to:

1. Develop CCS’s clear go-to market strategy and its tactics, before designing the organizational chart and key company positions.

• Andy designed the needed roles and responsibilities and defined the COO position and actually identified CCS’s new COO, Mr. Shep Werth.

2. Frame CCS’s marketing challenge as a distribution problem, instead of a demand problem.

• Andy suggested Jeff take his message directly to his ultimate clients, business owners, with the support of their advisors.

3. Andy outlined key sales and marketing tactics and located the resources, people and tools needed to have it up and running in months.

• He simplified the complexity of communicating the details of what a series captive is, who it is for, and how it works best for certain business owners.
• By introducing and overseeing a professional marketing communications specialist, The Karol Company, Andy assured CCS’s messaging was simple, engaging and consistent, starting from its website through its sales collateral and finally throughout actual client proposals.

Client Results:

Within months of Jeff, Andy and Shep establishing its strategy, The Complete Captive Solution, LLC is up and running as a going concern, having secured it’s licensing, established its key business partners and landed its first 10 clients.  Sales are on budget and both business owners and their advisors have recognized CCS as the premium provider and clear expert in the emerging field of series captives and how a business owner can best use them.

When Jeff Morella was asked, “What was Andy Birol’s contribution to the genesis of CCS?”, Jeff replied, “Andy Birol took my vision of offering an innovative service and guided me in turning it into a standalone business, built on a strong foundation and driven by clear business principles.  This assures it becomes a very strong, profitable business with sustainable growth.  Andy’s creativity, business experience and tenacity were the missing ingredients I needed as a lawyer to help me build an independent business.  I would encourage any business owner and their advisors to bring Andy into the job or case.  His unique style of independent thinking, business judgment and relentless follow-up make him a special breed of consultant.  I am fully confident that my dream of building a standalone, sustainable business is being realized and I am proud of the results that CCS has already achieved.”

Stop Straddling and Suffering! Re-Commit to Your Business With Your BHU®

Does it really matter why you’re staying on to run your difficult business? Is it out of choice or desperation? If you can’t sell it now, or don’t see an immediate alternative that pays you well and provides a similar lifestyle, then your business must improve and you have to do it.So what can you do and how can you get started? Please consider my matrix with its four choices to scope out your situation and focus your energies on fixing your business. 

The BGC Growth/Sale Matrix:

As a re-committed business owner, consider your options. You could grow your business to keep it or sell it. And in doing so, you could focus accountability on your self as the owner or on the company and its management.

	Owner(Your)Roles, Responsibilities and Rewards	Company and Management Roles, Responsibilities and Rewards
Grow and Keep Your Business	?	?
Grow and Sell Your Business	?	?

 

To help decide which of the four boxes you should focus your attention, please review my concept of Best and Highest Use here or simply remember:

Your personal and your firm’s Best and Highest Use® is:

1. Of all the things you do, what’s your Best and Highest Use® (BHU)
   
   1. What you like doing
   2. What you are good at doing
   3. What the market has valued in you and your firm
      
2. And again, what’s your firm’s BHU?
3. How can your firm focus on its BHU?
4. How can your firm leverage its BHU?

With this thinking, let’s revisit The BGC Growth/Sale Matrix and use your and your firm’s BHU to decide which box to focus on and emphasize to fix your company:

	Owner(Your)Roles, Responsibilities and Rewards	Company and Management Roles, Responsibilities and Rewards
Grow and Keep Your Business	A. When your BHU and your firm’s BHU are aligned and valued by your customers	B. When your management’s BHU is in demand by your customers.
Grow and Sell Your Business	C. When your own BHU is not in demand by your customers	D. When your management’s BHU is not in demand by your customers.

 

To elaborate on the four choices above:

A. You should grow and keep your business by personally devoting yourself to doing so. Your value to the firm is it’s primary reason for its success and your passion in running it and serving customers is very high.

B. Whether or not your customers value your own BHU, your marketplace values your company and it’s management. Fortify and invest in your management and what they need to grow your company.

C. You are not connected or in touch with what makes your company special or profitable. Fix what your company needs to thrive by bringing in professional managers, resources and solutions. Sell your company when your investment can be maximized and your company’s can grow no further with you at the helm.

D. Your staff is not growing your business and you need management talent and solutions your firm may not be able to afford. To make matters worse, your BHU may not be what the business needs to thrive. Consider bringing in an equity partner or reinvesting your retained earnings to beef up what needs to be fixed. Or sell the business as a “turnaround” and move on.

Recommitting to your business doesn’t have to be a decision that takes a lifetime to fulfill. But doing so successfully means taking decisive short-term steps and not straddling or suffering. Your clients, management and employees are counting on you to act responsibly and successfully. Fortunately you have wonderful choices and can make them quickly and based on your BHU and that of your management’s and company. And you can decide to grow it or sell it after you have fixed it.

Five Keys to Sustaining Your Advanced Consulting Business

After 14 years of consulting and relocating my business to Western Pennsylvania, many of you have asked, “What keeps you going, Andy?” In advance of my introducing an “Advanced Consulting Mastermind Group” with Michael Couch and the Pittsburgh Consulting Community on January 31st, here’s a preview of my keys to keeping your consulting business healthy and wealthy.

1. Sustain and nurture your professional passion. Constantly learn about your clients’ challenges and help them succeed on their terms.
a.    Live to learn, but advise with detached passion. Stay devoted to your clients’ success and your market’s evolving needs and challenges. Develop a contagious curiosity for what could be and the unwillingness to accept the status quo. Your clients need this the most from you.
b.    Focus one third of your time on each of the following:
i.    Selling new clients and projects
ii.    Delivering the best work you can
iii.    Developing your own business

2. Focus on Your Best and Highest Use
a.    Refine what you’re good at, like doing and what the market has paid you most for doing.
b.    Repackage, repurpose and reinvent how you provide your Best and Highest Use. Constantly check what’s selling, how content is being is being adapted and what new problems and opportunities are confronting your buyers.

3. Embrace the ups and downs.  No client, methodology, problem or market will sustain you forever
a.    Change is constant in the consulting business. What was once scarce becomes abundant. Clients change and problems ebb and flow. Recognize the differences between business fads and timeless principles.
b.    Accept what you can improve as an outside change agent and what is the client’s responsibility. Your client’s engagement is non-negotiable if you are going to help them.

4. Learn from the best, but do it your way
a.    Surround yourself with the best practitioners as teachers and as peers. Consulting is a business where clients repeatedly paying and referring you is your best measure of success. Beware of those who spend more time teaching than consulting. Longevity in this unforgiving business is the best measure of success.
b.    Do it your way. A most wonderful aspect of consulting is your ability to customize your practice to best support your gifts and preferences. You choose your clients, the problems, how you best work and what goals you set.

5. Above all, do no harm
a.    Your clients are in your hands. Consulting is unregulated, unlicensed and requires no education or certification. You are your only judge of what’s ethical. Always take the high road.
b.    Your business is sacred. Your business is as important as your clients’ businesses and needs equal attention. Invest in it and nurture it so it will be stay healthy and remain state-of-the-art.

Consulting through the years makes for a wonderful life and profession helping clients reach their goals and yours along the way. Cherish, protect and nurture your business, and it will reward you in every way. If learning more about consulting and my insight is of interest to you, check out the Pittsburgh Consulting Community at http://www.mcassociatesinc.com/community/index.php after December 21st and join Founder Michael Couch and me on January 31st when we will introduce two exciting consulting roundtable opportunities for you!

Connecting Engagement to Profitable Growth

For years, I have wrestled with what role social media role really plays in creating profitable growth and wrote a rowdy piece for AMEX on it here. But building relationships or “engagement marketing” is critical to creating profitable growth. And recently, when Constant Contact asked me to speak at their engagement conference on profitable growth, I presented the following 5 findings:

Five Key Findings

1.  Customer Engagement

+ Your Firm’s Value

==============================

Profitable Growth in the New Economy

It is nice to chat online with communities and prospects, but it is crucial to speak in terms of your firm’s value and expertise. Whimsical topics may generate awareness and interest, but they must create live conversations where buyers can build interest and take action that leads to closed business and your profitable growth? Just like in marriage, unless engagement leads to committed customers it’s a waste of time and effort.

2.  To ensure your engagement efforts generate profitable growth:

• Do your math. Determine your how many engaged prospects you must generate and how many of these you must convert into buyers to make your money.
• Focus your engaged prospects on your Best and Highest Use (BHU^TM.) When you know your firm’s BHU and inject this into your conversations, your best prospects will respond to you in these terms.
• Convert customer engagement into profitable growth. Budget your engagement activities all the way through to your profitability.

3.  Confirm that your engaged customers stay profitable.

•         Measure exactly how much money your engaged customers are spending.

•         Track your cost of engagement and never let it exceed customer profits.

4.  Watch and ensure that your profitably engaged customers are paying you:

•         Measurably and predictably

•         Because of your social media/marketing

•         Based on your firm’s value

5.   Discover the specific ways how profitably engaged customers are paying you:

•         They buy samples, trials, assessments and diagnoses

•         Then they buy more

•         And they refer your company to their peers who do the above

Customer engagement is a new word for building relationships, which is as critical as it is imperative. But social media and networking, without a connection to profitability, is a new word for monkey business. Make it your business to do it right!

5 Steps to Refocus During Tough Times

Whether it’s the economy, your family, business, community or society, probably some part of your world has suffered over the last five years. Unfortunately, there are enough signs show that the next few years will continue to challenge even the luckiest, blessed and oblivious among us.  Even as we strive do “right and good,” what do we do if: demand for what we sell, access to resources we require, or our energy and drive simply dwindles?  

If you need a pep talk, read on. 

1. Recognize bad signs fast. As it’s been said, once is a coincidence, twice a trend, three times, a certainty. If something isn’t working, figure out why ASAP. The world is changing faster yet most people can’t change at all.  Every day I speak to people who feel trapped in so many ways. They have become what they tolerate because their pain of changing remains greater than their pain of not changing. In business, however, your marketplace (customers, employees and vendors and investors) will tell you the truth. For the other parts, get the personal, professional or spiritual support you need to accelerate changing your bad to good.
2. Take stock in your value; Your Best and Highest Use®  Accept quickly that your expertise and your firm’s experience are your greatest treasure. They remain yours forever and always the ingredients and foundation of your renewal.
3. Keep your eyes open; seek opportunity. Wherever there is pain, need or hope, you can find and make opportunity. Follow your heart and your head. Your internal voices are ever more righteous as you mature.  When most people take a hit, they lose faith in their judgment, impact and options. Stand apart and stay confident.
4. Refocus, regroup, repurpose. Take your BHU and the opportunity or pain you uncovered and link these and then find customers who will value your repackaging. Activity matters so keep trying new versions and push forward. Try giving away your reinvention or better yet sell it right away. In facing setbacks such as bad timing, backward thinking and an ADHD society, rely on your passion and conviction to drive you to success. Remember your BHU is portable and deliverable. If you doubt where’s the demand for your value, go where you:
   1. Are getting human and viral response
   2. Have raving fans 
   3. Are scarce
5. Stay focused/don’t blink. Anything you create takes 3-6 months to generate reaction/awareness in the marketplace and 1-3 years to take root. Create the opportunities for quick wins and the metrics to prove your wins are real.  Before you can generate market success and profitable growth, remember to create prospects, and qualify and develop them into buyers.
   1. Connect online as much as you can

   2. Get seen, heard and interviewed
   3. Identify and nurture allies, referral sources and champions
   4. Make your viral marketing portable; avoid investing in fixed costs, particularly of traditional sales and marketing.

 Whether or not this all makes sense to you, think about the parts that do and put them to good use in refocusing your business in tough times. Email me at abirol@andybirol.com.

Companies Either Grow or They Are Sold

While financial gamers, schemes and scams have enabled many companies to avoid either profitable growth or a sale for years…

… ultimately one of these options is inevitable.

◦A company that is profitably growing is controlled by passionately committed owners and investors.
Their firm is financially and operationally self-sufficient. There is no need to merge or look for investors.  Its leaders can reduce its credit line and pay down outstanding loans. The company has customers who are happy to pay for its valuable products or services. Over time, the company will build up retained earnings and become a creator of wealth. As long as its owners are confident and passionate they should never think of giving up their independence in running it or cashing out. Life is good!

◦A company that is not growing profitably has flat or declining sales.
Its costs and expenses are fixed or rising and it starts to lose money. The company begins to consume more cash than it generates. Owner, banks or investors have to subsidize the company through credit or by tapping any retained earnings. These leaders lose passion for their business as it is no longer self-sufficient. Clearly, its customers cannot or will not pay enough for the firm to delivery its products and services.  First, the company runs out of cash, then out of credit and finally must be sold.

There are only two buyers for a company that is not profitably growing:

1.New owners and investors with ideas, cash and passion to return the company to profitable growth.
2.Bankruptcy trustees who sell the company for whatever they can to pay creditors pennies on the dollar.

So companies either profitably grow or they are sold.

What’s it going to be for your company? Do you agree or disagree?

Making Money on Marcellus: First Lessons Learned

If you own a business in Western PA/Eastern Ohio, the more you learn about the trillion-dollar business opportunity called Marcellus Shale, the more you may wonder how you can best profit from it.  But unless you’re selling directly to gas drillers or energy giants, you are probably wondering what to offer, who to approach and how to go to market. As I’m helping my clients and workshop attendees do this, here’s the first in a series of lessons I’ve learned:

First Lessons Learned on Making Money on Marcellus: 

1. Make Marcellus your rising tide; not your tsunami: Find a portion of the overwhelming demand you can profitably supply and make sure you can deliver on any business you close. As tempting as it is, don’t let any one customer become more than 20% of your business. My friend Shaun Seydor’s seminal report ” The Economic Impact of the Value Chain of a Marcellus Shale Well” ^*is a must-read and linked here with his permission and my gratitude. Read it and think about where your can catch the wave.
2. Follow the money and bring your “A” game: My early advice to clients is to avoid the big players (Range Resources, EQT, Chesapeake, Exxon/Mobil etc.) and sell to the companies who sell to these big boys. Stay one step removed from the “tier one” companies, and you can keep more control over how you do business. But it’s still a fast and furious world and strong contracts are imperative.  Put your best foot forward and never forget: with all this opportunity you are competing in the big leagues. Fortunes will be made and lost. This is a great time to Recharge Your Best and Highest Use^® 
3. Stake out your value and place in the food chain.    Learning where and to whom you offer the greatest sustainable value is critical. There are many ways to slice the Marcellus marketplace. Identify your ideal target buyer and know their buying process. Build a selling process that matches their buying process.  Here’s an article to help you think about this http://profitablegrowth.com/shout-out-or-shout-at-your-sales-force-is-it-generating-sales-growth-in-the-new-economy/ Also, decide where your business fits into these two graphs from the Marcellus report: Figure 1 – Types of Economic Impacts (p 4.) and Figure 2 – Phases and Key Steps in Developing a Marcellus Shale Well Site (p.10).
4. Timing is everything. Many business owners I’ve met operating in the Marcellus tract complain that the “out of towners” won’t hire local companies or that “the money is yet to show up.” Make sure what you sell is ready to be purchased. Watching what your customer’s customers are buying is one way not to make your move too soon or too late. Here’s a piece I wrote in a different context but has some good tips on figuring out your best timing http://profitablegrowth.com/is-your-demand-down-or-distribution-dying/
5. Chase transactions or relationships Most companies working in the Marcellus space can be split into transactional firms who do business one sale at a time (e.g. gas stations) and those relationship companies growing over the long term (e.g. cleaning companies.)  Match how your business profits best to the right kind of kind of customers that you should do business with. To help you decide which you should focus on, here’s an article for you http://www.andybirol.com/DisplayContent.aspx?MenuID=626  

 Unlike the great Oklahoma Land Rush where everyone got a fair start at the same huge opportunity, Marcellus is much more complicated and tricky despite the trillion-dollar economic windfall it is. Stay tuned. This is the first in a series of pieces I will write as I learn lessons with my clients and workshop attendees on making money on Marcellus. 

 Do you have questions on how your business or audience can make money on Marcellus? Call or email me and let’s talk about it.

^*By Heffley, Seydor, et al & the Katz Graduate School of Business at the University of Pittsburgh.

Finding the Extraordinary in the Ordinary For W.K. Thomas

As a growth consultant for small businesses, I’ve enjoyed many opportunities to see how various small businesses function, especially those that have operated for a number of years. In an age of understaffed companies and conflicting and competing demands, most of these companies are so busy helping their customers that they don’t take the time to help themselves.

They tend to lose sight of what I call the extraordinary that lies at the heart of the ordinary in their operations–the characteristics that make them special and unique. One such company in Butler County is W.K. Thomas.

The president of this company lacked a formal marketing program and realized that traditional, relationship selling would not get him to where he wanted to be—in the scarce space of marketing and sales in their respective businesses. Now, he’s changing his company to achieve that.

Thus far in our work together, he’s focused on expanding his values and defining and honing what I call his individual Best and Highest Use®. Best is what he loves to do. Highest is what he does really well. And Use relates to what his customers value and are willing to pay for.

Under the leadership of Brent Thomas, W. K. Thomas & Associates provides pre-engineered steel building and construction services to the commercial, industrial, community, and religious markets throughout Western Pennsylvania.  Brent’s father, Bill, now Vice President, established W.K. Thomas in 1974 as a custom-home builder and general contractor. Since then, the company has remained a privately owned, family company.

Other firms rely heavily on the service offerings of project management and estimating as commodities to drive business forward. They end up competing in a market where bottom dollar pricing and the resulting low-quality construction become the norm.  But Brent Thomas is linking the brand of W.K. Thomas to pre-engineered steel buildings as the company’s big differentiator and is driving revenues up. His company is growing a reputation in Butler County as the go-to company for these types of buildings.

“I’ve stepped outside of being jack of all trades,” says Thomas, “I’m focusing on pre-engineered steel buildings, which is our Best and Highest Use, have taken on more responsibility for sales, and I’m reorganizing our team to help energize this new direction.”

When I began working with Brent Thomas, he had a strong, well-established business with great potential for growth and wanted to take his company to the next level.  What made sense for him was my ability to find the extraordinary within the ordinary of his company. My approach has been to find the characteristics that make him special and different from his competitors, and to cultivate these aspects into exciting opportunities to grow his business.

Working with him and his customers has led me to understand his product lines, how they add value, and how they develop special relationships with his customers, whose feedback is critical to our endeavor.

The upshot is that now W.K. Thomas is becoming more aggressive in proclaiming its value and more consistently educating its customers about what it can do to help them. Thus far, we’ve focused on expanding Brent’s values and defining and honing his individual Best and Highest Use®.

Throughout my years of consulting with businesses like W.K. Thomas, I’ve deployed this approach to help more than 430 businesses owners identify the specific markets that’s right for them and their companies. This has had a $450-million impact on the economy.

Best and Highest Use also immunizes companies against the “Be All Things to All People” disease. This disease is as common as a cold, but it’s as deadly as the plague for small businesses.

When business owners fail to target specific markets in this way, a number of consequences occur, all of which are bad. Their companies aren’t special. They’re mediocre, forgettable, or worse. People can’t refer customers to them. Their companies attract unqualified prospects and waste resources on prospects who could care less about their offers. This, in turn, diminishes their efforts with regard to prospects who do.

What’s more, best use helps business owners to resolve the greatest pain or create the greatest opportunity for a narrow slice of a market. This creates a crucial intersection for them between their companies, their Best and Highest Use, and the needs of their customers.

Over time, I’ve had the privilege of learning, using, and teaching a variety of growth tools for organizations. We’ve used a variety of names for these processes, including strategic planning, management by objectives, sales management, and incentive compensation. Too often, these systems steamroller over the interests of the users. The fact is that old-fashioned, autocratic tools just don’t work anymore.

More than a few times, I’ve had people challenge my concept of Best and Highest Use, saying that it’s just another term for distinctive competence, one of the buzz words that periodically make the rounds of corporations and MBA programs. In one way, they’re right. Best and Highest Use is essentially distinctive competence for business owners. The difference – and it’s a large one –is that although distinctive competence speaks clinically of skill sets and marketplace advantages, Best and Highest Use involves an owner’s emotions, goals, and personality.

One concept I hear kicked around is the term, best practices. But this assumes that all firms start out and grow and stay completely equal. To center your business on best practices is to deny, ignore, and disrespect your Best and Highest Use. How can you ever tell if you are better or worse than you should be if you only judge yourself on the basis of the lowest, common denominator of other companies?

Working together, Brent Thomas and I continue to focus on his individual Best and Highest Use to translate new customer demand into substantial, dramatic growth and confidence in his abilities.

In the short and medium term, we’re tailoring initiatives designed to achieve profitable sales growth. At the same time, this company leader is experiencing a renewed excitement and passion for his business. At a time of economic hardships when competitors are pulling back or taking cover, their passion and excitement is giving him confidence to make it work.

As we reinforce the abilities of W.K. Thomas to deliver higher value at lower cost, we’re decommoditizing the company.

This is not to say it’s easy. For one thing, Brent has had to break old habits. That’s difficult. But my goal is to push him out of  his comfort zone in a way that causes willingness to raise new behaviors while preventing him from making ultra-risky, bet-the-company decisions like introducing price changes to gain market share, hiring non-producing sales people, or getting rid of a sales force.

As I work with companies like his that have enjoyed years of success, I’ve enabled them to make course corrections a step at a time. The end result has been that they’ve sharpened their views on the kinds of businesses they want, the kinds of services they deliver, and they’ve stopped trying to be all things to all people. These are hard choices that emerge from recognizing that everything they may be involved in is not a business.

Andy Birol is the Founder and President of Birol Growth Consulting, www.andybirol.com. You can reach him at 412-973-2080 or at abirol@andybirol.com.

Advanced Referral Marketing

If you run a company, lead a sales and marketing team, or sell for a living, you know that referrals are your best source of new business.

• Nothing beats an introduction from a peer who knows what you offer to a prospect who needs your value now.
• No matter how strong your sales skills, marketing programs, or products and services, a referral to a qualified prospect most helps you close the sale.
• If most buyers turn to colleagues they trust for recommendations when making a purchase, who do yours turn to?

If referrals are your business’ best way to grow, why don’t we develop our referring skills and seek out more and better referrals? Instead, too many businesses lament the lousy referrals they get from well-meaning business friends. Whose fault is that? Rather than launch a costly and risky lead generation effort, why not improve your advanced referral marketing skills?

The Basics of Getting Referred
To review, there are some critical ingredients to getting a referral. You must:

1. Provide specific value to a defined target prospect. If you do not have a Best and Highest Use® please define yours now or settle for being referred as a commodity.
2. Be excellent. Always grow your track record of quality work and results.
3. Stay in front of those who refer you. Communicate with them regularly and provide new and valuable information.
4. Be trusted. Prove to your referral sources you will treat them and their referrals with respect.

While these fundamentals never go out of style, enough people practice these well enough now, that distinguishing your “refer-ability” takes even more effort.

Five Steps to Advanced Referral Marketing

To grow better and get more referrals, here are five steps you can take now:

1. Determine Your Need for Referrals
2. Understand Your Prospects’ Buying Process and Then Align Your Selling Process and Referrer’s Role
3. Define the Ideal Relationship Your Referral Source Should Have With Your Buyer
4. Give Referrals to Get Referrals
5. Develop Specific Tools and Tactics

Here are the five steps in detail:

1.  Determine your need for referrals. Are you clear on where in your sales and marketing process you need a referral and for what purpose? Do you need help finding, keeping or growing your existing business? Do you need an introduction, validation, or affirmation from your referral sources? At which point in your sales funnel are you most in need of their support? Is it in qualifying prospects or developing prospects? For help in determining this, review the PACER Process.
2.  Understand your prospects’ buying process and then align your selling process and role for your referrer. Understanding your customers’ buying process is not new but applying this knowledge in obtaining referrals might be. Where can your referrers have the most impact?

If your business is a relationship or an anniversary business, your referral sources need to be constantly cultivating your prospects for you, but if your business is more transactional or event-driven, then you want your referees to be far more opportunistic and pounce when they see the chance to recommend you. Here are two articles to help you decide this. Click Events or Anniversaries: What’s Your Business? Or Relationships or Transactions: What’s Your Business?Once you understand the role your referral sources play in your prospect’s buying process, you will of course align your selling process to parallel their behavior. And the role that your referees need to play will be clear.

3.   Define the ideal relationship your referral source should have with your buyer. What are the ideal   referral sources for your business? For example, some businesses enjoy most of their referrals from law or accounting firms while others are best referred by suppliers or even their competitors. To determine who is best for you, understand the role your referral source plays with your prospects and why a prospect would accept their referring you to them. For example, a parts supplier is unlikely to refer a financial planner to a purchasing agent because this is not a likely topic for them to discuss. Consider whether your referral source has the sufficient trust and professional intimacy with your prospect to make such a referral. For example, a specialist can often refer another specialist while another specialist will seldom refer a generalist. Also, your referral sources must see you as a scarce commodity as opposed to being abundant. If every business broker is hounding every banker to refer them their next deal, how can anyone care or remember which one to refer to whom? The 80/20 rule applies just as much as to referees. A few will refer a majority of your leads and most will only refer you once. Understand who falls into which groups and why. Finally, make it as easy as possible to refer you. I provide any referral source with the following description of my target prospect and exactly why when and how they would hire me. Come up with your own example along the following lines as I have in my business.

A  target prospect for Birol Growth Consulting is a majority owner/operator of a business who is:

A.  Dissatisfied with his or her business’ level of profitable growth.
(as good or bad as it may be)
B. Impatient to grow their business to the next level
C. Is a
a. Services Firm
b. Wholesaler/Distributor
c. Manufacturer

D. Willing to take and apply advice by working with an expert who empowers optimism
E. Willing to pay for the value of outside advice that generates ten times the investment

4.   Give referrals to get referrals. Apply the Golden Rule in your referral activities. Generously and freely give away as many referrals as possible. While many will disagree, I urge you not to take  commissions or fees for referring business. The time you put into developing a fair scheme is not worth the loss of trust you face when your peers learn you are making money off of whom you referred to them. Despite many opinions to the contrary, do not enter into tying, exclusive relationships or “Circles of Influence” with only one referral source such as a single law firm. Your power in referring and being referred comes from being able to match the right people with the best skills and style. There is no one size fits all here. But most importantly, remember who did refer you, follow up and keep them posted on how your or their referral faired. There is nothing more disappointing to refer or be referred and never hear what happened. If you do refer someone constantly and there is never any reciprocity, ask yourself if you have fulfilled the basics as outlined above. Before getting annoyed with your non-responder, ensure you have refocused on the basics, if you have, then it is time to find new advocates.

5.   Develop specific referral tools and tactics. Make it easy for your referral sources to refer you. One of the great tools is the reciprocal referral letter. Attached at the bottom of this article is a sample letter you can send, one-for-one, with a mutually referable source. Making it one-for-one is fun, as it challenges both parties to provide great referrals and then to hone their selling skills in obtaining as many appointments, proposals, and closed sales as possible.

Find ways to donate your services to charities so that your referral sources can place you in highly visible venues. Serve as a subject matter expert for their customers where you can showcase your expertise while helping your referral source’s clients.

Summary

Referral marketing can be one of the most enjoyable as well as the most profitable tactics in growing your business. Develop your skills and practices in this area and you will surely enjoy better clients, better relationships not only with those who value you the most, but most of all with people you like whom like you. And after all, isn’t this what business is supposed to be all about? For help in accelerating your referral marketing efforts, to explore how we can refer each other, or simply to learn more, please contact me at (412) 973 2080 or at abirol@andybirol.com.

Here is a sample referral letter you can modify for your business or, (with my gratitude) use to refer Birol Growth Consulting:

Mr. John Smith
President
Smith Products
222 Allegheny Blvd, Suite #4
Wexford, PA 15444

Dear John:

Growing my firm has always been challenging and risky. I often wrestle with questions of what to invest in and when. I wanted to pass on an intro of an exceptional business expert and friend of mine, Andy Birol, of Birol Growth Consulting.  He is a published author (5 times I think), accomplished speaker and advises small to mid-sized operating businesses owners on effectively driving top line profitable growth.

• How has my marketplace changed its buying behavior and how should my firm respond?
• How can I create more profitable growth?
• What new channels for profitable growth can I pursue?

While you may not have heard of Andy, I know him personally and he has an extensive record of working nationally to great reviews. In his short time here in Pittsburgh, he has become a regular columnist for eTEQ Magazine and has been accepted into Leadership Pittsburgh.

I told Andy you were on my short list of must-visits and I’ve suggested he give you a call.  He’s making a positive impact in Pittsburgh’s small business community.  I’m sure meeting with him will be a good use of both your time.  You can learn more about Andy before he calls, checkout his website at www.andybirol.com.  His articles, client list and newsletters are particularly interesting.  No doubt you’ll get an autographed copy of his latest book, The Five Catalysts of Seven Figure Growth, CareerPress, 2006.

If you have any other questions or need anything further please don’t hesitate to give me a call.

Thanks so much and take care,

Sincerely,
You
Your Company
Your Address
Pittsburgh, PA 15232

If Contracting is Your “Wild West,” Here’s 3 Ways to Become the Only Sheriff in Town.

Even in an improving economy, why does the contracting industry still feel like the last frontier? As long as financing stays unpredictable, customers pay late and subcontractors/tradesmen slip up, does running your business seem like a series of showdowns at the OK Corral? After helping dozens of owners in the building trades, I’m clear that formal planning and forecasting don’t work in the face of erratic weather, desperate bidding, and poor project management. But good contractors survive.  And a few have learned how to adapt and actually thrive by creating scarce capabilities and unique services. And some builders have done it so well that they have, in a sense become “The Only Sheriffs in Their Towns” in the “Wild West of Contracting.”

Recently I personally met, spoke with and asked over 20 PA-based contractors what they needed to do to succeed in the next two years.  They said three factors mattered most:

1.      Competitive estimating/pricing

2.      Quality work

3.      Great project management.

But they agreed that these factors are not a strategy for long term success. In the short run, every contractor may survive by delivering quality work on time and on budget. But as labor and material costs grow and credit stays tight, only the largest or cheapest firms may succeed over time by doing more and charging less.

So what is the answer?  Focus, perform scarce services, and move with the market. Here are three “Wild West” strategies I’ve helped my contracting clients invent, develop, and implement.

1.       Focus on your Best and Highest Use^®. WK Thomas Construction has focused on being a leader in building Butler^® pre-engineered steel buildings.

2.       Invent and Perform Scarce Services. Menard USA is a design-build specialty geotechnical contractor offering expertise on ground improvement for sites with poor soil.

3.       Move as the market moves. FlorLine Group^® is expert in the design and application of industrial floor, wall and ceiling coatings for electrostatic and other regulated (FDA) environments.

So which strategy will you take to become the only sheriff in your own town? The first step is to decide which of your differentiated skills, expertise and services you can charge more for to generate better margins. Although new products, markets and technologies are hard to develop and must be constantly protected from copycat competitors, they will turn your “Wild West” into looking less like “F Troop” and more like “Bonanza!”

Andy © Copyrighted by Andrew J. Birol, President of Birol Growth Consulting, who helps owners create profitable growth by growing their Best and Highest Use^®. Andy can be reached at (412) 973 2080, abirol@andybirol.com or www.profitablegrowth.com

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